Angel Academy Session 5 brings in Brian Dirkmaat, a startup attorney at Rimon, P.C and longtime SDAC sponsor, to walk the room through the legal mechanics of angel investing. Brian covers the full evolution of startup investment instruments - from the original bridge notes of the 1990s to today's post-money SAFEs - and breaks down the real differences between convertible notes, SAFEs, and priced equity rounds. The session goes deep on valuation caps, pro rata rights, the unresolved IRS question around QSBS treatment for SAFEs, and the practical tradeoffs between investing directly into a company versus through an SPV. If you've ever looked at a term sheet and wondered what you were actually signing, this is the session.
Key Topics
The evolution from bridge notes to convertible notes to SAFEs
How YC's post-money SAFE works: valuation caps, discounts, and MFN provisions
SAFE vs. convertible note: the unresolved IRS code 1202 (QSBS) question
Priced equity rounds: Series Seed vs. Series A (NVCA docs)
SPVs vs. direct investing: platforms, carry, admin fees, and when each makes sense
The California C Corp trap: unpaid founder wages and W-2 classification
Term sheet fundamentals: liquidation preferences, anti-dilution, board seats
